Chapter Preview
The evening news features a segment about interest rates, the Fed Chairman Ben Bernanke, and liquidity in credit markets.
What does all this mean? Do I care about interest rates? What is the Fed? Will this impact my firms ability to get a bank loan?
2012 Pearson Prentice Hall. All rights reserved.
1-1
Chapter Preview
These are good questions.
And this course will help you answer these questions by addressing a variety of topics ranging from the functioning of the bond and sock markets to the behavior of the Fed and banks.
1-2
1-3
1-4
1-5
1-6
1-7
1-8
Stock Market
1-9
1-10
1-11
2. Financial Crises
The financial crises of 20072009 was the worst financial crisis since the Great Depression. Why did it happen?
1-12
4. Financial Innovation
Focusing on the improvements in technology and its impact on how financial products are delivered
1-13
1-14
1-15
1-16
Learning Objectives You should be familiar with and able to explain key elements of financial markets and how they function, including
the basic theory of asset demand and determination of asset prices, the role of arbitrage and profit motive in financial markets, the role of information in financial markets, and the causes and consequences of financial crises.
1-17
Learning Objectives You should be able to use appropriate models to analyze the issues listed above, and to draw appropriate conclusions about the effects of economic developments and policy interventions.
1-18
1-19
1-20
1-21
1-22